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Problem - Willey Company makes three products in its factory: plastic cups, plastic tablecloths, and plastic bottles. The expected overhead costs for the next fiscal year include the following:
Factory manager's salary
$210,000
Factory utility cost
70,000
Factory supplies
20,000
Total overhead costs
$300,000
Willey uses machine hours as the cost driver to allocate overhead costs. Budgeted machine hours for the products are as follows:
Cups
300 Hour's
Tablecloths
750
Bottles
950
Total machine hours
2,000
Required - Allocate the budgeted overhead costs to the products.
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